Ofgem threatened with legal action over price cap rise

The energy regulator is urged to take action to protect vulnerable customers before it introduces the new energy price cap

Big Zero Report 2022

Ofgem‘s new price cap and its impact on customers could soon be challenged in UK courts.

Not-for-profit organisation Good Law Project and campaign group Fuel Poverty Action has called on the energy regulator to conduct an “impact assessment” before implementing changes to the price cap.

The new level at which energy bills will be capped is expected to be announced next Friday, 26th August.

Political parties have already called for a price cap freeze while energy companies have proposed a plan to subsidise the price cap hikes with a fund backed by commercial banks.

The Good Law Project said: “In July, we wrote to Ofgem, expressing our concerns about its decision-making. We asked it to provide proof of its impact assessments. We got a three-line reply, which did nothing to ease our concerns.

“That is why we, along with Fuel Poverty Action and Dion Alexander, the Chair of the Highlands & Islands Housing Associations Affordable Warmth Group, have written to Ofgem demanding it does more to protect vulnerable people and off-grid communities.

“We are now calling on Ofgem to commit to carrying out proper impact assessments, and to consider appropriate mitigation measures, before raising the energy price cap any further.”

Dion Alexander commented: “Why is Ofgem discriminating so unfairly between off-gas and dual-fuel households?

Gas costs 7p a unit and electricity 28p a unit, but 15 percent of all UK consumers can’t get mains gas and can’t escape having to pay so much more than even their hard-pressed dual-fuel counterparts for exactly the same level of energy consumption.”

An Ofgem spokesperson told ELN: “Ofgem’s priority is to protect consumers and we know that people are currently under huge pressure as bills continue to rise.

“We will keep working closely with the Government, consumer groups and with energy companies on what further support can be provided to help with these higher prices.

“We can confirm that Ofgem has received a letter from the Good Law Project and we will reply in due course.”

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